Greece, struggling with more than 100 billion euros ($112 billion) of soured loans, wants to cap distressed debt sales, the country’s economy minister said.
Resisting calls from creditors to further open the market, George Stathakis, 62, said the government wants to maintain restrictions on the sale of such loans to distressed debt funds. Under the latest accord signed with creditors, Europe’s most indebted state is required to develop “a dynamic market” for non-performing loans and “remove any unnecessary legal or other impediments” to their disposal from banks.
“The position of the government is that we have already opened up 50 percent of the bad loans market,” Stathakis said in an interview Monday in Athens. “We want a long transitional period in place for sensitive categories, like mortgages, small consumer loans, as well as loans to small and medium companies.”
Greece is at loggerheads with creditors over a series of actions required for the completion of its bailout review. The steps are needed to pave the way for the next emergency aid disbursement from the euro area and for debt relief talks to begin. On distressed debt sales, the latest agreement provides for the protection of vulnerable households, but the scope of restrictions remains a subject of ongoing negotiation with officials representing the “quartet” of the European Central Bank, the European Commission, the International Monetary Fund and the European Stability Mechanism.
“There are different views, we are negotiating,” Stathakis said. [Bloomberg]